During the week of March 2–6, 2026, U.S.-Israeli military strikes on Iran significantly disrupted global financial markets, particularly impacting energy prices and currency movements [1]. The strikes triggered a surge in oil prices, pushing them toward levels not seen in nearly two years, as traders responded to heightened geopolitical risk and supply concerns [1]. The disruption was compounded by the effective halt of tanker movement through the Strait of Hormuz, a critical chokepoint for global oil shipments [1].
The Canadian dollar emerged as a notable performer amid the turmoil, while the euro absorbed much of the negative impact among major currencies [1]. Early in the week, hawkish economic data influenced market sentiment, but a historic jobs miss later in the week added further volatility [1]. These developments forced traders to rapidly adjust their expectations regarding inflation and central bank policy paths, as the macroeconomic backdrop dominated market dynamics [1].
Overall, the event led to significant repricing across asset classes, with currencies reacting strongly to the shifts in energy markets and broader economic uncertainty [1].
CONCLUSION
U.S.-Israeli strikes on Iran caused a sharp rise in oil prices and widespread volatility in currency markets, with the Canadian dollar outperforming and the euro under pressure. The disruption of tanker movement through the Strait of Hormuz and shifting economic data forced traders to reassess inflation and central bank outlooks. The market impact was substantial, driven by geopolitical risk and macroeconomic uncertainty.